Forget Millennials: Time to Prepare for Generation Z
This post is not meant to disrespect Millennials. In truth, I've had my fill of Millennial-bashing comments and commentaries in recent years, often promulgated by the not-so-silent ranks of disdainful Boomers and disgruntled Gen Xers, much of it undeserved. The largest demographic group in U.S. history, the Millennial generation (aka Gen Y) already has and will continue to cast a long shadow, shaping societal mores and influencing marketing budgets for years to come. With all due respect to this current generation, it's time for marketers and businesses to begin preparing for the next one, Generation Z, an ethnically diverse lot of full-fledged digital natives who, in their tendency to favor IMs over emails and customer experiences over brands, in many ways represent the full flowering of behavioral trends sown by their Gen Y forerunners.
A Generation Apart
Defined as those born after 1995, the vanguard of Gen Zers are early twenty-somethings who'll be graduating college in 2017 and interning at your company shortly thereafter, and who may already be (or soon will be) spending money on the goods and services you or your clients are selling. In fact, by 2020, Generation Z will account for 40% of all consumers. But who are these Gen Zers? What overarching characteristics and beliefs go into defining who they are, what they like, and how they'll spend?
Many of these same questions were raised at a gathering of martech experts during the recent 2016 SXSW Interactive Festival in Austin, Texas. Happily, Forbes contributor Rachel Arthur had the good sense to summarize a number of key facts and stats that were discussed about Gen Zers in this post. I've taken the liberty of arranging some of her findings into six broad themes that provide an emerging snapshot of who Generation Z is and, by extension, offer some insight into how they should be marketed to.
Truly Mobile First
We often associate Millennials with mobile, however, Gen Zers are 2x more likely to shop on mobile devices than Gen Yers. This should come as no surprise for a generation who cut their teeth during the second iteration of the digital age, when mobile was gaining transcendence over desktop. It goes without saying that this generation has come to expect, almost as a given, mobile friendly, fully responsive, cross-device interfaces and seamless omnichannel customer experiences. In short, if your business hasn't made the transition to mobile, you better get cracking. To underscore this point, academic research shows how 79% of Gen Z consumers display symptoms of emotional distress when kept away from their personal electronic devices, taking the idea of mobile first to a whole new level.
Choose YouTube over TV
Twice as likely to use YouTube than their Gen Y counterparts, Gen Zers take in between two to four hours of YouTube and less than one hour of traditional television per day. As I noted in a post on social influence marketing, it's truly fascinating to observe the sway prominent YouTubers wield with today's youth. A survey conducted in July 2014 by Variety magazine found the five most influential figures among Americans ages 13-18 were all YouTubers. Mainstream celebs like Jennifer Lawrence and Seth Rogen took a backseat in popularity to the likes of YouTube phenoms PewDiePie and Smosh.
An unrelated study of younger Millennials and Gen Zers published in 2015 by DEFY media found that 63% would try a product or brand recommended by a YouTube personality. Brands with larger media budgets trying to connect with Generation Z would do well to shift resources out of traditional television advertising in favor of social influence marketing and targeted mobile video advertising on popular social video platforms like YouTube and Twitch.
Prefer IMs to Emails
Taken as a whole, Gen Zers think email is an outdated communications medium and are apparently 3x likelier to open a chat message received through a push notification. This from Jaclyn Ling, director of fashion and retail services at popular messenger app Kik. Granted, she has a vested interest in making such a statement, but in fairness, it squares with my own research and personal observation. It also explains why many of the biggest players in tech are getting into the instant messaging game, including Facebook (Instant Messenger, WhatsApp, and Instagram Direct), Google (Hangouts), Apple (iMessage), and Tencent (WeChat), to name a few.
Marketers interested in engaging with Gen Zers over IM should experiment with editorial placements, banner ads, and promoted chats where available. In an effort to monetize, many instant messenger platforms are beginning to roll out sundry advertising options and marketing-friendly functionalities. For example, Kik now offers keywords and targeting for its Promoted Chats feature, and Facebook is contemplating opening up its popular Messenger app to advertisers in the near future.
More ADD than Millennials
In true digital native fashion, Gen Z's attention span is estimated at a mere eight seconds, compared to a whopping 12 seconds for their more staid Millennial counterparts. At least partially, this may be owing to their tender age. Let us hope so.
Fluid and flighty, the majority of Gen Zers have multiple online personas, and it is estimated that they will experience as many as three careers by the age of 30. Not sure what this means for marketers, other than the general admonition that you better be on your toes and expect a lot of trial and error.
Favor Experiences over Brands
Here's some good news/bad news for marketers: Gen Z is all about experiences over brands. They care less about (and spend less on) material items than they do experiences - experiences they can share with friends and the greater world on preferred social media platforms like Instagram, WhatsApp, and Snapchat. Apparently they do care about brands, but they don't rely on brands to navigate their choices. All you marketers out there who have been pushing the notion of customer experience, well here's your chance to shine.
Diverse and Pluralistic
Gen Z is the most ethnically diverse generation in U.S. history, with 47% categorized as ethnic minorities. Such diversity has fostered a pluralistic attitude among many Gen Zers, who seem to have internalized the concept that people of many different races, religions, and orientations can in fact peacefully coexist.
To this I can add a small but not trivial anecdote from my own experience, or rather from that of my two Gen-Z-aged sons. If in the course of telling a story about their day at school they happen to describe a classmate, they never use racial or ethnic language as an identifier; instead, they tend to describe personality traits or general physical characteristics. Interestingly, I don't think this is a conscious choice on their part. Raised in a more multi-ethnic, pluralistic milieu, they simply don't recognize traditional racial and ethnic distinctions and stereotypes, at least not reflexively.
Perhaps not surprisingly, Gen Zers are also do-gooders: according to Marketo, 26% of 16- to 19-year-olds volunteer, 60% want their jobs to impact the world, and 76% are concerned about humanity's impact on the planet. It goes without saying that members of such an idealistic generation will likely put a high value on brand integrity. Marketers trying to connect with Gen Zers would do well to project an authentic brand voice.
The Flighty Do-Gooder Intern Next Door
So how do you market to an inherently digitally native demographic group with an average attention span of 8 seconds, a group weaned on ephemeral social platforms like Snapchat, Secret, and Whisper? I'm not sure, but given the fact that they represent 40% of the consumer base, I suppose I'd better start trying to figure it out.
In a cruel twist of marketing irony, or, better yet, marketing Karma, Gen Zers happen to embody many of the platitudes marketers (myself included) have been hawking with reckless abandon for some time now, i.e. mobile first, customer experience, brand integrity, yada yada. As such, Generation Z may force us all to put our money where our mouth is or face the very real consequences.
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